Score contribution per author:
α: calibrated so average coauthorship-adjusted count equals average raw count
Different political parties place different values on the environment. In considering a two-party democratic system and capital-intensive technologies, we find that forward-looking governments incorporate the probability of losing power into their policy design. When the party in power values the environment, it may levy an optimal dynamic tax that is larger than the Pigouvian tax. We investigate the parameters that affect the magnitude of this gap and assess the effect of the gap on the adoption of clean technologies overtime.